What to know about power of attorney

Apower of attorney is a powerful document that can protect your financial assets and medical interests if you are incapacitated. If you haven’t named a power of attorney to act on your behalf, now is the time to do so. If you have one in place, it may be the right time to revisit it.

“The pandemic highlights how quickly things can happen. It’s a good idea to have a power of attorney in advance,” said attorney Maya Simmons Rogers, managing partner of Simmons Rogers, a civil law firm in Smyrna, Georgia.

If something like a medical emergency happens and a person is incapacitated, without a power of attorney named the decision of who would be your guardian and conservator would be made by the courts.

Estate planning is often put off because it can be an unpleasant topic.

“In a weird sense people don’t want to plan for it because they think it will happen. They put it off until later, and later never comes,” Rogers said.

There’s also the idea that making these decisions is difficult and time-consuming, but creating a power of attorney is so much less expensive and quicker than people realize, Rogers said.

When to update

If your power of attorney dates back longer than five years, it’s a good idea to revisit it because laws change frequently, Rogers said. The document itself may not be invalid, but an out-of-date power of attorney may prove more difficult to use.

An older power of attorney may be grandfathered in to work with new laws, Rogers said. Under new laws certain powers must be explicitly stated and initialed by the principal to be effective, such as the power to handle real estate matters.

Another important reason for revisiting your power of attorney is that your relationship with the person you named may have changed.

“You may want to change the power that you gave them,” Rogers said.

Anyone can act as an agent as long as they are older than 18. People commonly name a spouse, child, relative, close friend or trusted advisor as a power of attorney.

Don’t fail to name a successor in addition to an agent who will act on your behalf, Rogers said.

Different types

“In a weird sense people don’t want to plan for it because they think it will happen. They put it off until later, and later never comes.”

Maya Simmons Rogers

There are several types of power of attorney. Be sure to choose the ones that best fit your needs, Rogers said:

• A medical power of attorney or advanced health directive names an agent who can make medical decisions on your behalf when you are unable.

• A financial power of attorney deals with financial, business, real estate, banking and other legal transactions. A general power of attorney can take these actions as well, but the power ends when a person becomes incapacitated.

• A durable power of attorney becomes active at a time designated by the principal and stays in effect even if the principal becomes incapacitated.

• A springing power of attorney is more limited. It takes effect only when a person becomes incapacitated, for example due to a car accident or during surgery.